Category: Tanzania

Strømme Foundation changes its strategy from a focus on microcredit to a focus on financing small and mediums sized companies, in line with what my own research and experience indicates to be a better path towards prosperous economic development. I concur with this move and look forward to seeing the results from this change, and encourage more organizations and investors to follow this path. This is not to say that microfinance is not helping poor people. Someone said to me: “These microloans do help a little especially when it comes to women who can send their kids to school. Put a metal roof with monies earned from the small businesses they setup.” I completely agree, but by focusing on small and medium sized companies, we can help create even more jobs through scaling businesses led by competent managers. It is simply difficult to scale a small microentrepreneur with very limited personal capacity to lead a larger business. I simply suggest that there are other means which we also need to explore. Financing of SME´s has until recently been a forgotten area of focus, and more and more investors are shifting towards this group as well for more impact.

MTI Investment is a Tanzanian/Nordic investment company founded by Professor Trond Randøy, PhD candidate/MSc. Pontus Engström, Dr Neema Mori and Dr Gibson Munisi. Since 2012 the team has been seeking investment opportunities in Tanzania, and built the relational infrastructure with key stakeholders such as universities, legal advisers and local firms. In early 2014 the company was formally incorporated and the first initial investments were performed.

What makes MTI Investment unique is our university-based approach to investing. We seek businesses that are run by highly competent university-educated managers and owners, and we capitalize on our university-based networks to help these businesses further excel. By being university-based we are able to be at the forefront of knowledge creation and entrepreneurship in East Africa.

Just ended an interesting two-week field trip to Tanzania. Me and the one eyed professor Trond, named so after a lost battle with his contact lens in the flight over, have been travelling around the Tanzanian country side, together with our Tanzanian colleague Dr. Neema Moori.

Bumpy road

Like three explorers we have travelled on bumpy “roads” in a 4wd jeep meeting many small businesses around Tanzania and also presented and discussed research at the University of Dar Business School, the leading business school in Tanzania, on micro entrepreneurship and microfinance.

University of Dar es Salaam Business School

Driving on the left hand side was an experience. When we changed from driving on the left hand side to the right during a weekend in the 1960s, the Swedes allegedly first started with busses and trucks on day one, and on day two allowed cars to switch side (a Norwegian joke..…).. In Dar es Salam we experienced some of this when driving in the “mixed lane” in the middle…

Stockholm 1967 or Dar es Salaam mixed lane 2014?

We have met many innovative entrepreneurs, discussing gold mining operations and suggested alternative methods instead of their dangerous usage of mercury and cyanide, seen farming, visited a dairy production, a security business, a honey business, a power plant in Burundi, solar-power companies, coffee and fruit juice operations, construction companies and much more.

Young men seeking gold in the small Tanzanian mines.500 chicken

We also met Statoil and learnt about the current status and plans for the country. They have found gas 100 km out in the sea outside the Tanzania coastline. Drilling for gas in depths of 2000 meters is new to Statoil and the transportation of the gas once recovered is not the easiest thing. One of the biggest obstacles to Statoil is getting the bureaucratic permits and reaping any revenues from the drilling lies years ahead, but the government of Tanzania is already busy setting up a “welfare fund”.

In terms of the small businesses, there is no shortage of ideas and opportunities and the future of Tanzania is promising, although some major challenges and risks are ahead, such as road infrastructure, schooling, health and housing, and of course access to finance and an efficient government. A day at a pig and poultry farm was encouraging with environmentally friendly production methods, and good treatment of the animals, but we smelled like pigs back at the hotel afterwards….

Small baby pigs at a farm start-up

Over the weekend we took a small, Indiana Jones inspired, plane to Stone Town, Zanzibar, see blog. When sitting just behind the pilots we noticed how the co-pilot fell asleep and awoke when we landed…. The other pilot was a short fellow who had to stand up while landing the plane, quite the scene, but we landed safely. Tanzania and not the least Zanzibar is blessed with some amazing shorelines and beautiful scenery. Islam is the dominant religion at Zanzibar, whereas Tanzania is more mixed between Islam and Christianity.

Beach at Zanzibar

While travelling we were pulled over 4 times by different cops for various reasons, such as crossing the double-lines in the middle of the road, which of course we had not done. All this was part of the daily revenue generation strategy by the police force. The revenues from the first 150 pulled over go to the government, while the rest go to the police force… If they stopped you, it was better to pay the 20 dollars than to spend 30 minutes discussing with them, which they knew. But they were very nice, typically dressed in white.

Victoria lake, stone structures, near Mwanza

Today, coming home to celebrate my “insanely great” first born and oldest daughter Ella, turning 13 years old. <3<3<3<3

During my studies I have spent some time in Tanzania. This could be seen as luxurious, but it is quite hard work and many long trips on rough roads. So after a tough week , I am spending a couple of days in Stone Town on Zanzibar. This is where Freddie Mercury lived during his first 12 years, before his family had to flee because of the revolution in Zanzibar, where over 20,000 Indians and Arabs were killed. A genocide in itself, but Zanzibar is known to have been the site of one of the largest slave markets in the world and during a visit to the site of the former slave market in Zanzibar, one become aware of one of the world ‘s worst human abuse.

(see photo above)

Many in Sweden and West are probably familiar with the massive slave trade between West Africa, Brazil, the US and back to Africa.

(see image above)

But unlike the Western slave trade, where some people today can trace their family’s history back to the slave trade, there are few similar traces remaining of the estimated 12 million people who were brutally “removed” from central and eastern Africa via Zanzibar. For 200 years, there were, I am told here, annually 60,000 people abducted via Zanzibar to Saudi Arabia and the Middle East.

(see image above)

Trading began in the 7th century and counting from this time the figure is higher. Unlike the slave trade that took place from West Africa there are few traces or relatives of these populations today. Many of these slaves (men , women and children) hence died. It means that this may be one of the largest forms of genocide, especially when including the westward trade. Within the British Empire, slavery was formally abolished in 1833, to a great degree thanks to William Wilberforce persistent work in the English Parliament ( see the movie Amazing Grace). But the trade continued in Zanzibar and the Sultan was not interested to put an end to this. The final end to slave trade in Zanzibar can however be partially attributed to Dr . David Livingstone’s requirements on this in the English Parliament in 1857. After “a few years”, after strong pressure from the British, the Sultan of Zanzibar later stopped this practice and was richly compensated for this. This is so recent that many of the turtles that live in the waters around the coast of Zanzibar and can be over 200 years old , lived at this time.

(see image above)

At the place where there previously was a slave market there is currently a great cathedral and the place that was used to whip the slaves is replaced with an altar. In the ground , there is a mark where the slave pole was. The slave pool was in fact a large tree. The slaves were whipped and those who did not cry were considered to be strong and therefore sold at a high price , while those who wept were sold at a lower price. Women and children were given as a bonus to those who bought many slaves. The women were separated from their men, and children from their mothers. Just outside is a monument made ​​by Swedish artist Clara Sörnäs.

(see photo above)

Two slave chambers of an original 15 still remain – one for men and one for women and children. In these chambers slaves were kept for two days before an auction was held. Many died during this time. The chambers were close to the water and when there was high tide the water came into the chamber and then “cleaned” the chambers which had the toilet as the floor in the middle.

Large populations are in other words completely wiped out. Still today, some 150 years after the slave trade was formally abolished, the effects can be seen .

Today, the slave trade continues in new forms, and it is not only in other countries, including Arab countries, but also Sweden is effect, such as in the areas of berry picking. Every year, a report is issued by the U.S. Department of State, on Human Trafficking. The report ranks other nations to what degree they follow international conventions or show step to do so. Among the 19 countries that do not follow these conventions or doing enough we find countries such as Eritrea, Congo (DRC), Iran, North Korea, Kuwait, Russia and Saudi Arabia.

One question one need to ask: How and when should this debt with Africa be settled?